On the proposal for a directive of the European Parliament and of the Council amending Directives 2006/43/EC, 2013/34/EU, (EU) 2022/2464 and (EU)… 2024/1760 as regards certain corporate sustainability reporting and due diligence requirements

The European Commission published a Proposal for a Directive of the European Parliament and of the Council amending Directives 2006/43/EC, 2013/34/EU, (EU) 2022/2464 and (EU) 2024/1760 as regards certain corporate sustainability reporting and due diligence requirements on 26 of February 2025.

As a reminder, the European Commission’s proposal for a Corporate Sustainability Reporting Directive (CSRD) ((EU) 2022/2464) formed part of its commitment to a European Green Deal and strengthened the foundations for sustainable investment. The European Commission’s proposal for a Corporate Sustainability Due Diligence Directive (CSDDD) ((EU) 2024/1760) put forward and detailed mandatory due diligence processes for companies to fulfil their responsibilities and to be held liable for failures to do so, codifying already existing international standards.

DROI adopted opinions on both proposals.

CSRD established the extension of sustainability reporting requirements to all large companies and listed companies (except micro-enterprises) and more detailed reporting requirements, particularly on areas relating to UN Guiding Principles on Business and Human rights, according to mandatory EU sustainability reporting standards.

CSDDD contributed to fostering positive behavioural change by companies towards identification, prevention and mitigation of harmful impacts of their operations and relationships in their global value chains.

The rapporteur welcomes the spirit of the new proposal to simplify and reduce the burden on European Union enterprises. Nevertheless, this goal should not put into question the European Union responsibilities in the defence of human rights including their defenders.

Human rights reporting is very much an area in development and guidance and clarity of process and definitions need more time to bear their results.

The CSDDD has given the EU an opportunity to assert itself as a global normative power by showing leadership in addressing the serious sustainable development challenge faced by societies collectively and globally. The Directive should not be reviewed just after its adoption - as it punishes those companies who have already started working towards future implementation - and if so, it should be done rather limitedly and based on extensive consultation.

The EU had established a policy coherence and complementarity forming a meaningful ensemble with all these Directives that are now under revision. The rapporteur agrees on eliminating an unnecessary extra burden on companies in case it is identified but not at the cost of human rights standards and their promotion.

The CSDDD presents an unparalleled occasion for the EU to integrate human and environmental sustainability into business and corporate practices and to drive change on the global level. Therefore, to review it now could endanger this approach in a current world situation in which human rights standards are increasingly challenged. Furthermore, many EU companies implement already on a voluntary basis these due diligence standards.

To this end, the following elements that are in the current legislation could be kept:

- ensuring that the definition of stakeholders remains adequately wide, in order to ensure that all relevant voices are heard, at the different stages of the due diligence process;

- ensuring that companies do not carry out due diligence efforts solely with their direct business partners, but based on the risk of adverse impacts determined by their sector of activity and the context of their operations;

- requiring companies to meaningfully engage with stakeholders with the aim of informing and improving their corporate decisions and due diligence practices, as well as to ensure protection and safety of all stakeholders from retaliation and reprisal for their participation;

- requiring Member States to provide an option for companies to suspend a business relationship for a defined period of time

- ensuring liability of companies and guaranteeing access to justice and legal remedies for victims of harm linked to violations of due diligence obligations.

AMENDMENTS

The Committee on Foreign Affairs submits the following to the Committee on Legal Affairs, as the committee responsible:

Amendment 1

Proposal for a directive

Article 4 – paragraph 1 – point 2

Directive (EU) 2024/1760

Article 3 – paragraph 1 – point n

Or. en

Justification

This revised wording recognises the function of CSOs in due diligence and aligns with international standards. Requiring stakeholders to be ‘directly’ affected would mean that many key stakeholders, such as families of victims, might be excluded. At the same time, it adds flexibility with the addition of the words “where relevant,” making the definition adaptable depending on sectors and legal contexts.

Amendment 2

Proposal for a directive

Article 4 – paragraph 1 – point 4 – point a

Directive (EU) 2024/1760

Article 8 – paragraph 2 – point b

Or. en

Justification

The objective of the deletion is to remove the limitation on direct business relationships only. Although paragraph 2, part (a) is not being amended here, we would hope that the lead committee will revert to a risk-based approach that brings the CSDDD back in line with international guidelines, by removing the focus on tier 1. The removal of the word ‘direct’ means that companies can focus resources where it is strictly needed, based on the mapping done in (a).

Amendment 3

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

Article 11 deals with “bringing actual adverse impacts to an end” not “preventing potential adverse impacts” which is covered by Article 10.

Amendment 4

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

Article 11 deals with “bringing actual adverse impacts to an end” not “preventing potential adverse impacts” which is covered by Article 10.

Amendment 5

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

Article 11 deals with “bringing actual adverse impacts to an end” not “preventing potential adverse impacts” which is covered by Article 10.

Amendment 6

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

Article 11 deals with “bringing actual adverse impacts to an end” not “preventing potential adverse impacts” which is covered by Article 10.

Amendment 7

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

This amendment clarifies that any suspension of the business relationship must be defined, in order to provide greater clarity and certainty to SMEs, who must be protected from indefinite suspension.

Amendment 8

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

This amendment clarifies that any suspension of the business relationship must be defined, in order to provide greater clarity and certainty to SMEs, who must be protected from indefinite suspension.

Amendment 9

Proposal for a directive

Article 4 – paragraph 1 – point 6

Directive (EU) 2024/1760

Article 11 – paragraph 7

Or. en

Justification

Article 11 deals with “bringing actual adverse impacts to an end” not “preventing potential adverse impacts” which is covered by Article 10.

Amendment 10

Proposal for a directive

Article 4 – paragraph 1 – point 7 – point b

Or. en

Justification

Regarding the revision of (c), responsible engagement with stakeholders under Articles 10(6) and 11(7) are core parts of the UNGP and stakeholder input provides relevant information during this process. Regarding the deletion of (e), stakeholder engagement is critical during monitoring, as outlined in Article 15.

Amendment 11

Proposal for a directive

Article 4 – paragraph 1 – point 8

Directive (EU) 2024/1760

Article 15

Or. en

Justification

Assessments of companies implementation of the due diligence process must take place at regular intervals. A yearly review is in line with international standards.

Amendment 12

Proposal for a directive

Article 4 – paragraph 1 – point 12 – point a

Or. en

Justification

This deletion of the Commission's proposed amendment would reinstate the harmonised civil liability regime across Member States originally in Article 29(1) of the CSDDD. A specific EU-wide civil liability regime prevents distortions in the internal market and ensures a level-playing field for Member States

Amendment 13

Proposal for a directive

Article 4 – paragraph 1 – point 12 – point c

Or. en

Justification

This amendment reinstates the original Article 29(3)(d). Without this Article, many victims of corporate abuse would not have effective access to justice, thus limiting their human right to remedy under Article 47 of the Charter of Fundamental Rights.

Amendment 14

Proposal for a directive

Article 4 – paragraph 1 – point 12 – point e

Directive (EU) 2024/1760

Article 29 – paragraph 5 – first subparagraph

Or. en

Justification

This deletion of the Commission's proposed amendment would reinstate the harmonised civil liability regime across Member States originally in Article 29(5) of the CSDDD.

Amendment 15

Proposal for a directive

Article 4 – paragraph 1 – point 12 – point f

Or. en

Justification

This amendment would reinstate the overriding mandatory application of Article 29. This provision would ensure that both civil liability and relevant access to justice measures (such as time limitations) are applicable law. Removal of overriding mandatory application would lead to greater legal divergence and fragmentation.

ANNEX: ENTITIES OR PERSONS FROM WHOM THE RAPPORTEUR FOR OPINION HAS RECEIVED INPUT

Pursuant to Article 8 of Annex I to the Rules of Procedure, the rapporteur for opinion in declares that he received input from the following entities or persons in the preparation of the (draft) opinion, prior to the adoption thereof in committee:

The list above is drawn up under the exclusive responsibility of the rapporteur for opinion.

Where natural persons are identified in the list by their name, by their function or by both, the rapporteur for opinion declares that he has submitted to the natural persons concerned the European Parliament’s Data Protection Notice No 484 (https://www.europarl.europa.eu/data-protect/index.do), which sets out the conditions applicable to the processing of their personal data and the rights linked to that processing.